Lyft, GM To Launch Autonomous Vehicle Public Road Tests Within Year

By Mike Ramsey and Gautham Nagesh

General Motors Co. and Lyft Inc. will begin testing a fleet of self-driving Chevrolet Bolt electric taxis on public roads within a year, a move central to the companies’ joint efforts to challenge Silicon Valley giants in the battle to reshape the auto industry.

The plan is being hatched a few months after GM invested $500 million in Lyft, a ride-hailing company that rivals Uber Technologies Inc. The program will rely on technology the being acquired as part of GM’s separate $1 billion planned purchase of San Francisco-based Cruise Automation Inc., which has been working on self-driving technology for about two years.

Details of the autonomous-testing program are still being worked out, according to a Lyft executive, but it will include real customers and based in a yet-to-be disclosed city. Customers will have the opportunity to opt in or out of the pilot when hailing a Lyft car from the company’s mobile app.

In addition to driverless cars, the Detroit auto giant aims to use Lyft and its growing army of drivers as a primary customer for the Bolt, an electric car that launches later this year amid soft demand for electric vehicles. GM and Lyft currently rent out the Chevy Equinox to drivers needing vehicles in Chicago, but that program will expand to more cities and rely heavily on Bolts in the future instead of small sport-utility vehicles.

Because the Bolt’s battery is under the floor, it opens up space in the front of the vehicle and offers back seat passengers more leg room. GM executives have touted the car as an ideal fit for drivers needing space and lower operating cost.

GM’s effort to rapidly hem together recent big-dollar investments is an answer to the tech industry’s efforts to displace conventional auto makers. Many global auto makers have been lapped by key developments born in Silicon Valley, including Tesla Motors Inc.’s electric cars, Alphabet Inc.’s autonomous Google car program and Uber’s ride-sharing business.

The effort is most directed at challenging Alphabet and Uber. The Google self-driving car program has gained a sizable lead over conventional auto makers via testing in California and other states, and it received an additional boost this week after inking a minivan-supply agreement with Fiat Chrysler Automobiles NV. Uber, much bigger than Lyft, has its own self-driving research center in Pittsburgh and is preparing for autonomous vehicles in its fleet by 2020.

Executives at Lyft and Uber have said one of the top hurdles to success is navigating a patchwork of regulations that govern the use of autonomous vehicles and liabilities. In an effort to ease regulatory concerns, Lyft will start with autonomous cars that have drivers in the cockpit ready to intervene — but the driver is expected to eventually be obsolete.

“We will want to vet the autonomous tech between Cruise, GM and ourselves and slowly introduce this into markets,” Taggart Matthiesen, Lyft’s product director, said in an interview. That will “ensure that cities would have full understanding of what we are trying to do here.”

Mr. Matthiesen said his company also is working out how to design the program by which Chevy Bolts would be available to prospective Lyft drivers, many of whom can’t obtain acceptable vehicles to taxi around customers.

“Really the question is: ‘Is it Lyft that owns the vehicles or is it GM that owns the vehicles?’” At the Chicago hub, GM owns the vehicles and dealers service them.

Although Tesla has created demand for high-price electric vehicles and has a long waiting list for a car designed to compete with the Bolt in 2017, other auto makers haven’t been as successful, especially as gasoline prices are low. Electric vehicles and hybrid-electric vehicles make up less than 2% of vehicles sold, according to Edmunds, and sales of pure electric cars like Nissan Motor Co.’s Leaf have generally been modest.

Write to Mike Ramsey at michael.ramsey@wsj.com and Gautham Nagesh at gautham.nagesh@wsj.com

Breaking the story

Mike Ramsey and Gautham Nagesh were first to report that General Motors Co. and Lyft Inc. plans to begin testing a fleet of self-driving Chevrolet Bolt electric taxis on public roads within a year. GM recently invested $500 million in Lyft, which is a ride-sharing company that rivals Uber.

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